December 2010 | Members

 

Please remember, ALL “Exit Targets” and “Stop Targets” are targets.  You should not have any “Hard Stops” entered to close any trades or “Exit Orders” in your brokerage account unless we list one.  We will send out an “Alert” or “Trade Update” if we want you to close a position OR if a new trade comes out.  Otherwise, follow instructions at all times in the 9am and 1pm updates.  Also, we will usually give you a heads-up if we think we are going to send an email outside of these time frames but it is rare that we do.

1:15pm (EST)

Jabil Circuit (JBL, $17.10, up $0.18)

March 19 calls (JBL110319C00019000, $0.80, flat)

Entry Price:  $0.70 (12/14/10)

Exit Target: $1.50+

Return: 14%

Stop Target: None

Action:  Jabil announces earnings this Monday, December 20.  Continue to hold.  If they can beat estimates and raise guidance then we should see a new 52-week high.  A 10% move would get shares past $18.40 which is the current one-year high. 

 

THQ (THQI, $5.97, flat)

June 6 calls (THQI110618C00006000, $1.00, flat)

Entry Price:  $0.75 (12/8/10)

Exit Target: $2.00

Return: 33%

Stop Target: None

Action:  Shares have touched $6.04 today and these options have 183 days before expiration.  We are expecting shares to trade up to $8, maybe $10 by mid-June.  Continue to hold.

   

Electronic Arts (ERTS, $15.76, up $0.05)

March 20 calls (ERTS110319C00020000, $0.21, flat) 

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: -5%

Stop Target: None

Action:  The March options have 92 days before expiration.  We are waiting for a break above $16 to get this trade rolling.  Continue to hold.


JDS Uniphase (JDSU, $14.29, up $0.42)

March 12 calls (JDSU110319C00012000, $2.70, up $0.40) 

Entry Price:  $1.25 (11/19/10)

Exit Target: $2.50 (closed half @ $2.70 on 12/13/10)

Return:  116%

Stop Target: $2.00

Action:  We closed half at $2.70 on Monday and we are trying to squeeze a little more out of the other half.  Continue to hold.

      

Aruba Networks (ARUN, $22.45, up $0.10)

January 25 calls (ARUN110122C00025000, $0.55, flat) 

Entry Price:  $1.20 (11/2/10)

Exit Target: $2.40+

Return: -54%

Stop Target:  Close the trade is shares fall below $20


Action:  We are still holding for a run past $25 but a break below $22 may have us exiting this trade early.  Most of our “newer” trades are with the March and April options which should carry us through the holidays as this trade is over a month old.  We haven’t gotten the action we wanted even though shares traded up to $24+ in late November.  Shares are building a nice base at current levels and are capable of making big moves but we are watching this one closely.  Continue to hold.       



PowerShares QQQ (QQQQ, $54.62, up $0.46)

January 53 calls (QQQQ110122C00053000, $2.20, up $0.30) 

Entry Price:  $1.54 (10/27/10)

Exit Target: $3.00+

Return: 43%

Stop Target: $1.55 (HARD STOP)

Action:  We are expecting a big move in the QQQ’s on Friday which is triple-witching day.  December triple-witching has historically been bullish with average gains of 2% in 17 of the last 25 years.  Continue to hold. 


American Tower (AMT, $49.97, down $0.16)

April (2011) 60 calls (AMT110416C00060000, $0.20, down $0.05) 

Entry Price:  $0.65 (10/20/10)

Exit Target: $1.30+

Return:  -69%

Stop Target: None

Action:  These options have 120 days before expiration.  Continue to hold.


Dendreon (DNDN, $36.60, up $0.68) (COVERED CALL)

December 40 call (DNDN101218C00040000, $0.05, up $0.02)

Entry Price:  $41.96 (9/13/10) sold October 45 call @ $1.30, (11/11/10) sold December call @$1.75

Exit Target: $45

Return: -7%

Stop Target: None

Action:  The December options expire this Friday.  We will be looking to SELL another call option on Dendreon in a week or two.  This will lower our cost basis even further.

Dendreon opened at $41.96 and you could have sold the October 45 call option for $1.30 on 9/13/10.  This lowered the cost basis to $40.66.

On 11/11/10 we sold the December 40 call option for $1.75 which lowered our cost basis to $38.91.  If the stock gets “called away” from us by mid-December then we make 3% in 3 months.


Other 2010 Portfolio OPEN positions (2):  These are trades that are still open in the portfolio that have longer expiration dates or are on “hold” but are not worth mentioning until they turn around.  We are still keeping track of the trade and we will record the results, accordingly, when we close them or the options expire.  Click on the 2010 Portfolio link in the Members Area to view ALL open/ closed trades.   

Biodel March 7.50 calls (from October)

Chesapeake Energy January 25 calls (from October)


WATCH LIST SECTION

These trades are NOT recommendations until we send out an alert.  These are trades that we like but have not added to the portfolio as an official recommendation because of market conditions or because we are waiting for better entry prices.  We will not list entry prices because these stocks are on the verge of breaking out or they could sell-off.

We will update this section in the morning.

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